FUND OF THE MONTH: Fidelity Sustainable Water and Waste

by 18 Mar, 2020

In our series with 3d Investing, every month we throw a spotlight on a sustainable investment fund, exploring its process, portfolio and performance to sort the stars from the spin. This month, 3d has pulled out Fidelity Sustainable Water and Waste, a brand new fund launched to address one of the planet’s most pressing challenges: effective and sustainable water and waste management.

Vital fund statistics

Fund name: Fidelity Sustainable Water and Waste
Sector: Global Equity
Investment approach: Thematic
Launch date: 9 December 2019
Annual Fund Fee: 1.1%
Minimum Investment: £25 with Fidelity FundsNetwork (other platforms available)

See the fund factsheet here. Then, if you need a hand deciphering it, check out our explainer article: ‘How to read a fund factsheet like a sandwich’ 

The 3D View

Fidelity is one the largest asset managers in the world and is able to draw upon significant resources. Environmental, Social and Governance (ESG) factors are considered across all of the company’s assets using in-house ratings to assess stocks, rather than just relying on third party providers. Fidelity Sustainable Water and Waste is one of the first funds in their sustainability range, with a clear thematic focus on the water and waste management sectors, both of which are underpinned by strong demographic drivers. At least 70% of the investments in the fund have to score favourably on ESG characteristics, with engagement being used to improve the performance of the remainder.  The fund is relatively new, but there is clear evidence of the strong thematic focus and rigorous application of ESG, backed by the resources of a very large asset manager.

Sustainable investment areas

Fidelity Sustainable Water and Waste  

Fidelity Funds Sustainable Water and Waste

Making a Difference

Fund manager Bertrand Lecourt highlights areas for improvement in investee companies, focusing on the most material issues. Engagement with the companies the fund invest in is pro-active and seeks the adoption of best practices and outcomes are tracked. The managers also participate in advocacy programmes with other investors and organisations to raise standards and work together for change.

Impact of Fidelity Sustainable Water and Waste vs. MSCI World Index:

INVESTMENT SOLUTIONS POSITIVE PRACTICES LIMITED BENEFITS HARMFUL IMPACTS CASH
Fidelity Funds Sustainable Water and Waste 88.5% 2.2% 6.6% 0% 2.7%
MSCI World Index Top 250 31% 25.40% 28.40% 15% 0.30%

 

Investment returns

Fidelity Sustainable Water and Waste launched on 9 December, and so has very little performance to speak of. As we are also currently experiencing a sharp market downturn, current figures are a little meaningless. Water and waste management are, however, strong long term themes that are likely to perform well over time.

Fund Summary

Fidelity Sustainable Water and Waste

√ Exclusive focus on investments with a high positive impact

√ Annual sustainability report

√ Monitoring of key impacts

√ Positive influence on companies and within the industry

√ Low exposure to harmful industries

To find out how to invest in funds, check out our simple guide: ‘Make Responsible Investments in 4 Easy Steps

Like this? Sign up to New Money Mail for more!

 

About the author

About the author

John Fleetwood

John Fleetwood is founder and director of 3d Investing, the UK's leading sustainable fund analyst